The European Commission’s Digital Single Market Communication (2015) recognised that "unnecessary restrictions regarding the location of data within the EU should both be removed and prevented". The EU Executive later announced a forthcoming legislative proposal to enable the free flow of data within the EU Single Market.
The European Parliament welcomed this initiative in its Digital Single Market Resolution and asked that the ‘free flow of data’ initiative takes into account "concerns about the impact of data localisation requirements on the functioning of the single market".
A recent think tank study found that removing existing data localising laws in EU Members States would lead to an estimated 8 billion euros in GDP gains annually. Preventing harmful data localisation measures in the future would be worth another 52 billion euros per year, equal of 0.37% of EU GDP (ECIPE, 2016).
Despite its announcements and the wide support from the European Parliament and Council, the European Commission on the 10th January presented a Communication ‘Building a European Data Economy’ and a public consultation.
The Communication confirms that “unjustified restrictions on the free movement of data … impair the freedom to provide services and the freedom of establishment stipulated in the Treaty ... and risk fragmenting the market”. The trend “towards more data localisation” and the “lack of transparent rules” limit access to cheaper and more innovative data services.
The European Commission is now seeking input from stakeholders as it considers further action such as infringement proceedings against Member States’ laws or legislation.
This EIF debate will take stock of the current situation and discuss the best approach to enable data flows within EU to future-proof the EU Digital Single Market.